Statement by the board of directors of KlaraBo in relation to the merger with Sveafastigheter

Background

The Board and the board of directors of Sveafastigheter have today, 18 May 2026, adopted a joint merger plan (the “Merger Plan”), pursuant to which KlaraBo and Sveafastigheter have agreed to combine the companies through the Merger. The Merger will be implemented by KlaraBo being absorbed by Sveafastigheter, whereby KlaraBo’s shareholder will receive new shares in Sveafastigheter. The combined company which will be the result of the Merger (including the Portfolio Transaction, as defined below) is hereinafter referred to as the “Combined Company”. The Merger Plan is available on the companies’ respective websites, www.klarabo.se and www.sveafastigheter.se.

Sveafastigheter and KlaraBo acknowledge that factors like scale, financial strength and access to diversified sources of capital for an efficient financing are prerequisites for shareholder value creation. It is against this background that the Board and the board of directors of Sveafastigheter have concluded that the Transaction (as defined below), at this point, is value-creating and fair for both companies’ shareholders, as the Transaction (as defined below) both addresses these factors and could benefit from substantial synergies.

Sveafastigheter’s property portfolio, as of 31 March 2026, amounts to approximately SEK 29.4 billion, of which SEK 25.8 billion comprise of properties under management where 93 percent is located in Stockholm-Mälardalen, Greater Gothenburg, Malmö-Öresund and University cities, with Stockholm County as the single largest region.[1] The non‑income‑generating assets amount to SEK 3.6 billion divided into project development, SEK 2.2 billion, and properties under construction, SEK 1.4 billion, consisting of 787 apartments being erected in the Stockholm-Mälardalen market. One important pillar in Sveafastigheter’s business model is to upgrade apartments – with an operational target of upgrading 2,000 apartments by June 2029 – of which 521 have been upgraded by 31 March 2026. The total untapped potential of apartments eligible for future upgrades currently amounts to approximately 4,000 apartments.

Sveafastigheter also already manages all of the income-generating assets in the SBB Portfolio (as defined below) on behalf of SBB (as defined below). The SBB Portfolio (as defined below) amounts to approximately SEK 6.8 billion, of which SEK 6.5 billion consist of properties under management. Among the properties under management, 70 percent overlap geographically with Sveafastigheter’s existing portfolio and are located in the same markets. Compared to Sveafastigheter’s portfolio, the SBB Portfolio (as defined below) has a larger exposure to Stockholm-Mälardalen, a broadly similar exposure to University cities and a smaller exposure to Malmö-Öresund.

KlaraBo has a property portfolio amounting to approximately SEK 10.8 billion, of which 72 percent of the property value is located in University cities and in Malmö-Öresund, and approximately 2 percent in Stockholm-Mälardalen. Just like Sveafastigheter, KlaraBo has gradual apartment upgrades as an integral part of its business model, historically delivering 8 percent in yield on cost. In 2025, KlaraBo completed 188 apartment upgrades and has in the property portfolio about 3,600 apartments with remaining upgrade potential.

The completion of the Merger is conditional upon KlaraBo, prior to the completion of the Merger, acquiring a property portfolio from SBB i Norden AB (a subsidiary of Samhällsbyggnadsbolaget i Norden AB (publ) (including subsidiaries), “SBB”) comprising approximately 4,100 apartments in total, of which all properties under management are already managed by Sveafastigheter (the “Portfolio Transaction” and the “SBB Portfolio”, respectively). The Portfolio Transaction, the Extraordinary Dividend (as defined below) and the Merger are together referred to as the “Transaction”. The purchase price for the Portfolio Transaction shall be paid by KlaraBo issuing consideration shares to SBB in the form of 32,600,001 Class A shares and 74,997,402 Class B shares in KlaraBo (the “Consideration Shares” and the “Acquisition Issue”, respectively). The completion of the Portfolio Transaction is conditional on (1) the general meeting of KlaraBo approving the Acquisition Issue, (2) the general meetings of KlaraBo and Sveafastigheter approving the Merger (and the ancillary conditional resolutions), (3) the Swedish Competition Authority (Sw. Konkurrensverket) approving the Merger (including the Portfolio Transaction), and (4) the Swedish Companies Registration Office (Sw. Bolagsverket) (or, if applicable, a court) granting KlaraBo and Sveafastigheter permission to implement the Merger.

The Merger Consideration (as defined below) has been determined with the intention of achieving a fair distribution of the value in the Combined Company between the shareholders in Sveafastigheter and KlaraBo with consideration taken to the Acquisition Issue. In determining a fair Merger Consideration (as defined below) for both Sveafastigheter’s and KlaraBo’s shareholders, the Board and the board of Sveafastigheter have agreed on a relative valuation based on the estimated long-term net asset value of each company, and taking into account certain specifically identified adjustment items.

The Board will, as part of the Merger and in order to achieve an appropriate exchange ratio, propose that an extraordinary general meeting resolves to approve a conditional extraordinary dividend of SEK 1.40 per share (the “Extraordinary Dividend”) and that the Board is authorised to determine the record date for the Extraordinary Dividend. The Extraordinary Dividend is conditional upon the same conditions as the Portfolio Transaction, i.e., (1) the general meeting of KlaraBo approving the Acquisition Issue, (2) the general meetings of KlaraBo and Sveafastigheter approving the Merger (and the ancillary conditional resolutions), (3) the Swedish Competition Authority approving the Merger (including the Portfolio Transaction), and (4) the Swedish Companies Registration Office (or, if applicable, a court) granting KlaraBo and Sveafastigheter permission to implement the Merger. The completion of the Acquisition Issue will take place after the record date for the Extraordinary Dividend and consequently, the Consideration Shares will not entitle to the Extraordinary Dividend. The record date for the Extraordinary Dividend will be set by the Board in accordance with the above. Since the Extraordinary Dividend is an integral part of the Merger, it is also conditional upon the conditions for the Extraordinary Dividend being met prior to 1 December 2026. KlaraBo will receive a cash loan, in an amount equal to the total Extraordinary Dividend, from SBB which may be utilised to make the pay-out of the Extraordinary Dividend.

Sveafastigheter has issued ordinary shares which are listed on Nasdaq Stockholm. Each ordinary share carries one (1) vote at general meetings. Sveafastigheter also has the possibility of issuing Class C shares (carrying the right to one-tenth (1/10) of a vote at general meetings). However, no Class C shares are currently issued, and as a result of the Share Restructuring (as defined below), no Class C shares are intended to be issued before the registration of the Merger with the Swedish Companies Registration Office. The value of Sveafastigheter has been determined on the basis of Sveafastigheter’s estimated long-term net asset value, with a valuation date of 31 March 2026, which amounts to SEK 16,065 million (equivalent to SEK 81.40 per share, excluding treasury shares) and is supported by valuation reports prepared by Savills Sweden AB (“Savills”) and Newsec Advisory Sweden AB. In relation to the relative valuation, the long-term net asset value of Sveafastigheter has been adjusted downwards by a total amount of SEK 3.1 million, attributable to the value of Sveafastigheter’s share rights program. At the extraordinary general meeting of Sveafastigheter intended to approve, among other things, the Merger and scheduled to be held around 26 June 2026, a restructuring of Sveafastigheter’s share structure will be proposed through an amendment to the articles of association (the “Share Restructuring”). The Share Restructuring, which will be conditional upon the approval of the Merger, will mean that Sveafastigheter will remove the existing share class of Class C shares (there are currently no issued Class C shares in Sveafastigheter). It is also proposed that Sveafastigheter introduces a new class of shares in its articles of association – Class A shares – meaning that the now existing ordinary shares in Sveafastigheter will be called Class B shares after such amendment to the articles of association has been implemented. The ordinary shares are, and the Class B shares will therefore under the new share structure continue to be, listed on Nasdaq Stockholm. The Class A shares in the new share structure are not intended to be listed. The new Class A shares will carry 1.01 votes per share and the Class B shares will carry 1.00 vote per share, and otherwise carry the same rights. Sveafastigheter will also implement a conversion clause, whereby Class A shares can be converted to Class B shares at any time.

KlaraBo has issued Class B shares which are listed on Nasdaq Stockholm and Class A shares which are not listed on any marketplace. Each Class B share carries one (1) vote and each Class A share carries ten (10) votes at general meetings. The value for KlaraBo as well as the subscription price for the Consideration Shares have likewise been determined on the basis of KlaraBo’s estimated long-term net asset value, with a valuation date of 31 March 2026, which amounts to SEK 5,264 million (equivalent to SEK 35.03 per share, excluding treasury shares) and is supported by valuation reports prepared by Savills. In relation to the relative valuation, the long-term net asset value of KlaraBo has been adjusted downwards by the share dividend of SEK 0.25 per dividend-entitled share in KlaraBo resolved at the annual general meeting of KlaraBo on 29 April 2026 (the “Ordinary Dividend”), the Extraordinary Dividend of SEK 1.40 per share (to be paid out subject to the permissions necessary to implement the Merger Plan) and SEK 11.3 million attributable to costs associated with the repurchase and cancellation of KlaraBo’s outstanding warrants. Both the Class A shares and the Class B shares have been valued according to their respective equity interests in KlaraBo, and the voting power of the Class A shares relative to the Class B shares has therefore not affected the valuation.

The purchase price for the SBB Portfolio is based on an underlying property value corresponding to the fair value according to external valuation reports from Savills, with a valuation date of 31 March 2026, valuing the long-term net asset value in the SBB Portfolio to SEK 3,583 million.

The Merger Consideration (as defined below) has, when taking into account the factors stated in the Merger Plan and based on the number of shares in Sveafastigheter and KlaraBo as of the date of the Merger Plan (excluding treasury shares[2] and, with respect to KlaraBo, with the addition of the number of shares to be issued under the Acquisition Issue), in respect of the Class A and Class B shares in KlaraBo been determined such that for twenty-two (22) Class B shares in KlaraBo, the holder will receive nine (9) new Class B shares in Sveafastigheter, and twenty-two (22) Class A shares in KlaraBo entitle the holder to receive nine (9) new Class A shares in Sveafastigheter (the “Merger Consideration”). No cash consideration will be paid. Calculated based on the number of outstanding shares in KlaraBo as of the date of the Merger Plan (with the addition of the Consideration Shares), the aggregate number of newly issued shares in Sveafastigheter will be 105,500,557, of which 20,004,545 Class A shares and 85,496,012 Class B shares. Thereby, the total number of outstanding shares in Sveafastigheter following the registration of the Merger with the Swedish Companies Registration Office will be 302,850,327, of which 20,004,545 Class A shares and 282,845,782 Class B shares, and the shareholders of KlaraBo (after the implementation of the Acquisition Issue) would, thus in total own approximately 35 percent of the shares and votes in the Combined Company.

The completion of the Merger is conditional upon, inter alia, approval by the shareholders of each of Sveafastigheter and KlaraBo at their respective general meetings.

This statement is made by the Board[3] in accordance with section II.19 of the Stock Market Self-Regulation Committee’s Takeover rules for Nasdaq Stockholm and Nordic Growth Market NGM (the “Takeover Rules”).

The Board has engaged Gernandt & Danielsson Advokatbyrå KB as legal advisor in connection with the Transaction. The Board has engaged Deloitte AB (“Deloitte”) to issue a fairness opinion regarding the Merger. The fairness opinion is attached to this statement.

The Board’s recommendation

The Board’s view of the Transaction is based on an assessment of a number of factors that the Board has considered relevant in evaluating the Transaction. These factors include, amongst other things, the current market situation, the strategic merits of the Transaction, future opportunities and risks and KlaraBo’s financial position as well as the potential for the Combined Company.

Sveafastigheter and KlaraBo share complementary portfolios and geographic markets and a common strategic ambition and business model: to own, manage and develop high‑quality residential properties with a long‑term perspective. Including the SBB Portfolio, a more balanced regional exposure is achieved, and the combined property portfolio would amount to approximately SEK 47 billion making the Combined Company more than two times larger in property value than the second largest residential property company listed on Nasdaq Stockholm. Approximately 85 percent of the value of the properties under management is located in Stockholm-Mälardalen, University cities, Malmö-Öresund and Greater Gothenburg. Of the remaining 15 percent of the property value located in Other, 88 percent of the property value comprise of properties in A- or B-locations.

The Combined Company will have a larger share of income‑generating assets than Sveafastigheter currently has, as well as a substantially larger pool of apartment upgrades opportunities than KlaraBo has today. This enables an increased efficiency and a higher degree of stability in the refurbishment operations. The intention is that the Combined Company shall increase the share of income-generating assets further and in addition, to a larger extent, divest new-built development projects, once these are completed, in order to optimise capital allocation and cash flow generation.

The Transaction creates a scaled property platform with a broader geographic footprint, which is expected to reduce operational risk, result in a more resilient and diversified asset base and increase the risk adjusted return. The Board expects the Transaction to generate meaningful annual cost synergies of at least SEK 120 million from improved operational efficiency across property management, administration and financing.

The Combined Company is expected to be accretive with respect to key financial and credit metrics, reinforcing Sveafastigheter’s present position as the largest listed residential property company on Nasdaq Stockholm. The scale of the enlarged Combined Company – anchored by a more attractive financial profile and increased profit from property management per share – is expected to attract greater interest from both domestic and international investors, which together with the diversification of the shareholder base following the Merger is assessed to broaden the shareholder base further and increase share liquidity. This, together with an estimated increased dividend capacity per share, is expected to increase the pre-requisites for long-term value creation and an improved shareholder value in the Combined Company. The improved platform, credit metrics and cash flow generation also create prerequisite for a potential rating upgrade (from Sveafastigheter’s current BBB- rating) and are expected to enhance the Combined Company’s access to both bank and bond markets enabling funding on more favourable terms, thereby broadening the Combined Company’s financing options further and reducing its financing costs over time.

The Board is confident that the Transaction is attractive, value‑creating and fair for both companies’ shareholders. By bringing together three complementary businesses into a single and larger platform, the Transaction enables the Combined Company to further act on and capitalise on the opportunities in the market. The increased scale, improved cash flow and credit metrics, are expected to facilitate an increasing long‑term value creation for all shareholders. The Transaction may also enable the Combined Company to bring forward an updated dividend policy involving regular dividend payouts, complemented by share buy-backs to manage and optimise capital allocation to increase shareholder value. Following the completion of the Transaction, the board of directors of the Combined Company will resolve on revised operational and financial targets for the Combined Company as well as dividend policy taking into account operational, financial and credit rating considerations.

The Board has also taken into account the fairness opinion provided by Deloitte. Deloitte expresses in its opinion to the Board, dated 18 May 2026, which expresses Deloitte’s view as per that date, based on the considerations set out therein, that the exchange ratio is fair to KlaraBo’s shareholders from a financial perspective.

The Board notes that in relation to share prices and based on the closing price of SEK 33.10 per ordinary share in Sveafastigheter on Nasdaq Stockholm on 15 May 2026, the Merger Consideration corresponds to a premium of (i) approximately 0.6 percent compared to the adjusted closing price of SEK 13.46 per Class B share in KlaraBo on Nasdaq Stockholm on 15 May 2026, being the last trading day prior to the announcement of the Merger, and (ii) approximately 4.9 percent compared to the adjusted volume‑weighted average share price of SEK 13.43 per Class B share in KlaraBo during the 30 trading days before the announcement of the Merger. The foregoing share prices for KlaraBo have been adjusted for the Extraordinary Dividend. The Merger Consideration thus implies an equity value for KlaraBo of approximately SEK 2,035 million.

In summary, the Board considers that the Merger is in favour of KlaraBo and its shareholders. The Board further believes that the Merger Consideration is fair to the shareholders of KlaraBo from a financial point of view. Against this background, the Board recommends the shareholders of KlaraBo to vote in favour of the Merger at the upcoming extraordinary general meeting.

Impact on KlaraBo and its employees

The integration between the companies is crucial to realising the synergies that have been identified. A new board of directors for Sveafastigheter will be elected at an extraordinary general meeting to be held on or around 26 June 2026 (and such election will be conditional upon completion of the Merger). Its primary task in the short term will be to ensure continuity, support the successful integration of the Combined Company and that the synergies are realised. The Chief Executive Officer of Sveafastigheter, Erik Hävermark, and the Chief Executive Officer of KlaraBo, Andreas Morfiadakis, will continue in their current roles until the new board of the Combined Company has decided on the future management of the Combined Company. Following completion of the Transaction, the Combined Company will conduct a thorough review in order to capture the synergies and scale benefits that the Transaction is expected to deliver.

Any changes resulting from the Transaction relating to employment and operations in the locations where Sveafastigheter and KlaraBo currently operate will be assessed in more detail. Measures to be implemented in connection with the Transaction will be determined following a comprehensive review of both businesses during the period after completion of the Transaction. There are currently no decisions regarding any material changes to Sveafastigheter’s or KlaraBo’s employees or to the existing organisation and operations, including terms of employment or business locations.

Applicable law and disputes

This statement shall in all respects be governed by and construed in accordance with Swedish law. Any disputes relating to or arising in connection with this statement shall be settled exclusively by Swedish courts.

Information about KlaraBo and Sveafastigheter

KlaraBo in brief

We create value by acquiring, developing, refining, and managing residential properties with a long-term focus. Since our founding in 2017, we have expanded across Sweden and continue to grow in areas where people want to live and work. By maintaining and upgrading existing buildings, constructing new ones when conditions are right, and managing our properties in-house, we create value for our tenants, our investors, and the communities in which we operate. KlaraBo is listed on Nasdaq Stockholm and is traded under the ticker KLARA B.

For more information about KlaraBo, visit https://www.klarabo.se.

Sveafastigheter in brief

Sveafastigheter owns, manages and develops people’s homes. The property portfolio consists of a wide range of rental apartments in growth regions in Sweden. The buildings are managed and developed with a local presence and commitment. Sveafastigheter develops and builds new sustainable housing where the demand for housing is the greatest.

For more information about Sveafastigheter, visit: https://www.sveafastigheter.se.

__________________

Malmö in May 2026

KlaraBo Sverige AB

The board of directors

This information was submitted for publication in accordance with the Takeover rules for Nasdaq Stockholm and Nordic Growth Market NGM at 08.30 CEST on 18 May 2026.

Important information

For the purposes of this disclaimer, “this press release” means this document, its contents or any part of it, any oral presentation, any question-and-answer session and any written or oral materials discussed or distributed therein.

This press release may not be made public, published or distributed, either directly or indirectly, in or into the United States of America, Australia, Canada, the Hong Kong special administrative region of the People’s Republic of China, Japan, Switzerland and South Africa, or any other jurisdiction where such action, in whole or in part, would be subject to legal restrictions or would require additional information documents, registration, or other measures beyond those required by Swedish law. The information in this press release may not be forwarded or reproduced in a manner that is inconsistent with such restrictions or would entail such requirements. Any violation of these instructions may constitute a breach of applicable securities laws.

This press release does not constitute a merger document within the meaning of article 1(4)(g) and article 1(5)(f) of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market and repealing Directive 2003/71/EC (the “Prospectus Regulation”), a prospectus under the Prospectus Regulation or a prospectus under any other prospectus regulation (including, without limitation, the Swiss Financial Services Act) or an offer document within the meaning of the Takeover rules for Nasdaq Stockholm and Nordic Growth Market NGM issued by the Swedish Stock Market Self-Regulation Committee. This press release does neither constitute a notice to a general meeting.

This press release shall not constitute an offer to sell or the solicitation or invitation of any offer to buy, acquire or subscribe for, any securities or an inducement to make any investment decision, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. Any decision with respect to the proposed statutory merger of Sveafastigheter and KlaraBo in accordance with the Swedish Companies Act should be made solely on the basis of information to be contained in the actual notices to the general meetings of Sveafastigheter and KlaraBo, as applicable, and the merger document related to the Merger as well as on an independent analysis of the information contained therein. You should consult the merger document, which will be available prior to the general meeting at which the matters set out herein will be subject to vote, for more complete information about the Merger, and perform an independent analysis of the information contained therein when making any investment decision.

No shares in Sveafastigheter, KlaraBo or the Combined Company have been or will be registered under the U.S. Securities Act of 1933 (the “Securities Act”) or the relevant securities laws and regulations of any state or other jurisdiction of the United States. Neither the U.S. Securities and Exchange Commission nor any equivalent state-level authority has approved shares in Sveafastigheter, KlaraBo or the Combined Company or determined whether this document is accurate or complete. Any petition to the contrary is a crime in the United States. Shares in the Combined Company may not be offered, sold or delivered in the United States except in compliance with an exemption from the registration requirements of the Securities Act or through a transaction that is not subject to the registration requirements under the Securities Act. Shares in the Combined Company are not and may not be publicly offered, directly or indirectly, in Switzerland within the meaning of the Swiss Financial Services Act and no application has been or will be made to admit the shares in the Combined Company to trading on any trading venue (exchange or multilateral trading facility) in Switzerland.

This press release contains forward-looking statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors because they relate to events and depend on circumstances that will occur in the future whether or not outside the control of each respective company or the Combined Company. Such factors may cause actual results, performance or developments to differ materially from those expressed or implied by such forward-looking statements. Although managements of each respective company believe that their expectations reflected in the forward-looking statements are reasonable based on information currently available to them, no assurance is given that such forward-looking statements will prove to have been correct. You should not place undue reliance on forward-looking statements. They speak only as at the date of this press release and neither Sveafastigheter nor KlaraBo undertake any obligation to update these forward-looking statements. Past performance of Sveafastigheter and KlaraBo does not guarantee or predict future performance of the Combined Company. Moreover, Sveafastigheter, KlaraBo and their respective affiliates and their respective officers, employees and agents do not undertake any obligation to review, update or confirm expectations or estimates or to release any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this press release. Additionally, there can be no certainty that the Merger will be completed in the manner and timeframe described in this press release, or at all.

[1] Stockholm-Mälardalen, University cities, Malmö-Öresund, Greater Gothenburg and Other refer to Sveafastigheter’s markets as stated in Sveafastigheter’s financial reporting.
[2] As of the date of the Merger Plan, Sveafastigheter holds 2,650,230 of its own ordinary shares and KlaraBo holds 7,592,900 of its own Class B shares in treasury.
[3] Lennart Sten, Anders Pettersson, and Per Håkan Börjesson have a conflict of interest in relation to KlaraBo’s handling of the Merger pursuant to section II.18 of the Takeover Rules, and have not participated in the handling of the Merger by the Board. Lennart Sten is the chairman of SBB, which, as the parent company of Sveafastigheter, is to be equated with Sveafastigheter as offeror for the purposes of the Takeover Rules, has a conflict of interest pursuant to section II.18 of the Takeover Rules, and consequently, section III of the Takeover Rules applies to the Merger and KlaraBo is according to section III.3 of the Takeover Rules required to obtain, and to publish no later than two weeks prior to the date of the extraordinary general meeting of KlaraBo, a valuation opinion (a so-called fairness opinion) in respect of the Merger from independent experts. The Board has obtained a fairness opinion from Deloitte, pursuant to which the Merger Consideration in the Merger is fair, from a financial point of view, to the shareholders of KlaraBo, in support of its recommendation to shareholders to vote in favour of the Merger Plan at the extraordinary general meeting of KlaraBo.